Andrew Torgan
CNN Financial News Producer

Fed Chairman Ben Bernanke says that the economy is about to start growing again, although he cautioned it will be a slow recovery with continued high unemployment in the near term.

Speaking at an annual symposium in Jackson Hole, WY, Bernanke echoed a statement made by the Fed earlier this month, saying that "economic activity appears to be leveling out, both in the United States and abroad."

Bernanke went a step further though, indicating that "prospects for a return to growth in the near term appear good."

But the central bank chief warned that problems remain in financial markets around the globe, and that with banks facing "substantial" additional losses ahead, businesses and consumers will continue to have trouble accessing credit.

Home sales spike

Sales of previously-owned homes, the biggest portion of the housing market, soared more than 7% in July - the largest monthly increase in 10 years.

The National Association of Realtors says home sales rose 7.2% to a seasonally adjusted annual rate of 5.24 million last month, from a pace of 4.89 million in June. That’s the fourth-straight monthly increase and the highest level of sales since August 2007.

Of course, homes should be selling. Prices have fallen more than 32% from their peaks, set in the summer of 2006. Plus, mortgage rates that are near historic lows make the cost of purchasing a home lower than they've been in nearly 20 years.

State unemployment rates improve

The number of states posting a decrease in the unemployment rate in July more than tripled from the previous month.

The Labor Dept. says 17 states and the District of Columbia reported a drop in unemployment rates in July, compared with 5 states in June. Increases in unemployment rates were reported in 26 states, and 7 states posted no change from the previous month.

While the report showed improvement for the battered labor market, the changes in unemployment rates were very modest across the board: overall, unemployment rates didn't change much from June to July.

Michigan had the highest unemployment rate at 15%, but that was down 0.2 percentage point from June. Michigan has been especially hard hit by the collapse of the U.S. auto industry and the housing meltdown.

Rhode Island posted the second highest unemployment rate at 12.7% and Nevada rounded out the top three with a 12.5% rate.

The national unemployment rate fell to 9.4% from 9.5% in June, the first decline in that reading since April 2008.

Oil surges to 10-month high

Oil prices soared to their highest level since October today as investors grow hopeful that a recovery of the world economy is in sight.

Crude topped $74 per barrel. Oil hasn't traded that high since Oct. 20, 2008, when it reached an intra-day peak of $76.12.

All told, oil has surged by two-thirds this year after closing out 2008 at $44.60 per barrel.

Follow the money… on Twitter: @AndrewTorganCNN

Exxon Mobil is paying the price for its pollution.

Terry Frieden
CNN Justice Producer

Oil giant Exxon Mobil Corporation has pled guilty and will pay $600,000 in fines for the deaths of 85 protected migratory birds in the firm's wastewater ponds in five states.

Waterfowl, hawks and owls protected under an international treaty were killed after landing in open uncovered pools where they were coated with or ingested fatal doses of hydrocarbons, federal officials said.

The facilities are in Colorado, Wyoming, Kansas, Oklahoma and Texas.

"This is a great win for the environment," Acting Assistant Attorney General John Cruden told reporters in a telephone news conference.

Justice Department lawyers announced Exxon Mobil also agreed in a plea deal filed in federal court in Denver Wednesday to spend millions of dollars to implement a three-year program to cover its natural gas well reserve pits and waste water storage facilities.

A government lawyer said the law requires oil and gas companies to scrub the water of contaminants, remove the ponds, or place an obstruction such as plastic netting over the water to prevent birds from landing.

The government's environmental lawyers credited Exxon with fully cooperating after the issue was brought to the firm's attention.

"They've already spent about 2.5 million dollars and will spend quite a bit more to implement the environmental compliance plan," said trial attorney Robert Anderson.

The birds killed over a five year period were identified by the Fish and Wildlife Service as ducks, grebes, ibis, passerines, shorebirds, owls, martin, and a hawk. None is listed as an endangered species.

The Justice Department said $400,000 of the fines will go to a wetlands conservation fund, and $200,000 in community service payments will be directed to waterfowl rehabilitation and preservation organizations.

The Migratory Bird Treaty Act signed by the U.S. Canada, Mexico, Japan and Russia was enacted in 1918.

Andrew Torgan
CNN Financial News Producer

Washington may be focused on the Sotomayor confirmation hearings, but Wall Street is prepping for earnings from the nation’s biggest banks.

Among the financial institutions reporting this week are Goldman Sachs, JPMorgan, Bank of America and Citigroup. Other big names like Johnson & Johnson, IBM, General Electric and Intel also report this week.

Traders are buzzing about Goldman Sachs in particular, which recently paid back its share of government bailout money. Analysts are predicting the bank earned a profit of more than $2 billion in the March-June period, due to its trading prowess across world markets.

If they’re right, Goldman’s rivals will once again be left to wonder exactly how the bank, long the envy of Wall Street, could have rebounded so dramatically only months after the nation’s financial industry was shaken to its core.

Oil prices dip below $59/barrel

Oil prices briefly dropped below $59 per barrel today, dipping to a 7-week low below before rebounding on concerns about the state of the global economy.

Crude dropped 11% last week - the biggest weekly decline since late January - as traders worried the possibility of another dip in economic activity before the onset of recovery, which could delay a rebound in oil demand.

Gas down nearly 40% from last year’s record high

Gas prices dropped 8-tenths of a cent overnight to $2.529 - the 22nd straight day of declines.

In the last 22 days, the average price has decreased 16.4 cents, or 6.08 percent. The average price of a gallon of gas is also down $1.585, or 38.5 percent, from the record high price of $4.114 that AAA reported on July 17, 2008.

The highest gas prices are in Hawaii ($3.270). The cheapest are in Missouri ($2.281).

Money: America's Best Places to Live

Yes, strong local economies do still exist. These small towns as ranked by Money Magazine have them - plus great schools, affordable homes, low crime, and more. See the Top 100 - including detailed city profiles, homes for sale, and job openings.

Andrew Torgan
CNN Financial News Producer

President Barack Obama this week will propose the most sweeping reorganization of financial-market supervision since the 1930s, a revamp that would touch nearly every corner of banking from how mortgages are underwritten to the way exotic financial instruments are traded.

In an Op-Ed piece published in today's Washington Post, Treasury Secretary Timothy Geithner and the Director of the National Economic Council, Lawrence Summers, said the proposal would grant the Federal Reserve increased power in the oversight and management of the largest financial companies in the market.

It would also create an agency like the Federal Deposit Insurance Corp., to oversee consumer-oriented financial products.

The President is expected to officially unveil the specific details of the proposal on Wednesday.

Oil falls below $70 per barrel

Crude oil prices sank more than $2 to below $70 per barrel today as the U.S. dollar rose, stocks fell and a slew of global events put downward pressure on prices.

Oil prices had been on a tear recently. On Thursday, crude settled at $72.68 - the highest since Oct. 20 - before giving back some gains Friday.

Stocks turn lower

Stocks on Wall Street tumbled out of the gate this morning as investors dumped a variety of shares, influenced by protests in Iran regarding the disputed presidential election and a slump in commodity prices and stocks.

Through the end of last week, Wall Street had been on a three-month run up. The Dow has risen in 12 of the past 14 weeks and was in positive territory for the year for the first time since January. And the S&P 500 is up 40% from its 12-year low in March.

Gas nearing $2.70

Gas prices rose 6-tenths of a cent overnight to $2.67. This is the 48th consecutive increase.

Since April 29th, the average price of gas has increased 62.1cents or 30.3%.

The average price of a gallon of gas is down $1.44 or 35.1% from the record high price of $4.114 that AAA reported on July 17, 2008.

The highest gas prices are in California ($3.006). The cheapest gas prices are in South Carolina ($2.463)

Andrew Torgan
CNN Financial News Producer

Gasoline prices rose 2.4-cents to $2.572 overnight, the 37th straight increase.

In the last 37 days, the average price of gas has increased 52.4 cents, or 25%.

Prices are still below the all-time high of $4.114 that AAA reported on July 17, 2008, but the seemingly relentless march back toward $3 a gallon gas is starting to make drivers nervous.

The highest gas prices are in Hawaii ($2.856), while the highest prices in the contiguous U.S. are in Michigan ($2.840). The cheapest gas prices are in South Carolina ($2.375).

Crude oil spikes

Crude oil prices are rising above $68, boosted by forecasts of higher oil prices from Goldman Sachs.

Goldman raised its end of 2009 oil price forecast to $85 a barrel from $65 and introduced a new end of 2010 forecast of $95.

The all-time for high for crude was $147.27 a barrel, hit back in July 2008.

Ongoing claims for jobless benefits decline

We’ve got a break today in a key measure of the jobs picture. The number of people on the unemployment insurance rolls fell slightly last week for the first time since January, while the tally of new jobless claims also dipped.

First-time claims for jobless benefits declined by 4,000 to a seasonally adjusted 621,000 from the previous week's revised figure of 625,000, nearly matching analysts' expectations.

But number of people receiving benefits for one week or more fell by 15,000 to 6.73 million, the first drop in 20 weeks. Still, the number of initial claims remains stubbornly high - above the 605,000 level reached five weeks ago - and point to another sizable drop in payrolls when the May employment report is released on Friday.

Unemployment tops 15% in 13 cities in April

While the job picture appears to be improving somewhat, we have a reminder of just how bad things have been in recent months.

There were 13 unlucky cities with unemployment rates topping 15% in April, and another 93 saw joblessness climb above 10%, according to a government report released earlier this week.

Nine of the baker's dozen are in California, a state ravaged by the housing meltdown and an unparalleled state budget crisis. By comparison, only seven cities reported unemployment rates above 10% in April 2008.

April 2009 was also the fourth consecutive month that unemployment rose in all of the nation's 372 metropolitan areas compared with the same month in the prior year.

These monthly metropolitan-area numbers from the Bureau of Labor Statistics lag behind the government’s national unemployment statistics, which showed the nationwide jobless rate was 8.9% in April.

Wal-Mart: We’re hiring

Wal-Mart, the world’s largest retailer, says it expects to hire more than 22,000 people to staff its new or expanded stores in the U.S. this year.

The company said it will add 1,000 or more workers in each of 8 states: Arizona, California, Florida, Michigan, New Jersey, South Carolina, Utah and Virginia.

Wal-Mart added 33,000 jobs in the United States last year, according to the company’s annual report released in April.

Wal-Mart is the largest private-sector employer in the United States, with a workforce of nearly 1.5 million people.

Retail sales figures disappoint

Most retailers continued to suffer sagging sales in May despite reports that showed more American consumers are regaining confidence in the economy.

Sales tracker Thomson Reuters, which tracks monthly same-store sales for 30 retail chains, said overall May sales for the group fell a worse-than-expected 4.8%, compared to a gain of 1.1% last year.

Same-store sales, a key gauge of a retailer's performance, measures sales at stores open at least a year.

One factor that’s skewing the results however is Wal-Mart's exclusion from the firm's monthly sales index. The company announced last month that it would no longer provide monthly same-store sales data.

Coming to America: the 'world's cheapest car'

Finally, the chairman of India's Tata Motors says he hopes to offer the Nano, dubbed the “world's cheapest car, “in the United States within two years.

The vehicle will have to meet all U.S. emission and crash standards, of course, before hitting the street. Tata plans to offer a European version of the car, which costs about $2,300, in 2011.

The four-seater Nano gets up to 65 miles per gallon and cheap labor helps keep the price down.

Andrew Torgan
CNN Financial News Producer

Big developments today for two of Detroit’s Big Three.

General Motors says it’s fallen far short of the bondholder support it needed for its proposed debt-for-stock offer, virtually guaranteeing that the nation's largest automaker will be forced to file for bankruptcy court protection within the next five days.

And in a sign that a bankruptcy filing could come as early as Friday, GM moved up the pay date for its employees this week.

Hourly employees represented by the UAW were paid today and salaried employees will be paid on Thursday. Both normally would have been paid on Friday.

Chrysler in court

It’s is judgment day for Chrysler and hundreds of auto dealers. A federal judge in Chrysler’s Chapter 11 case could decide today whether to give the automaker permission to sell the bulk of its assets to a group headed by Italy's Fiat in the hope of saving itself from liquidation.

Lawyers for Chrysler say the Fiat deal is the company's only hope to avoid being sold off in pieces, but more than 300 objections to the sale have been filed by the carmaker's dealers, bondholders and former employees.

But if the deal doesn't close by June 15, Fiat could back out.

Economists see recession ending this year

A group of leading economists say the end of the recession is in sight.

But while the economy is showing signs of stabilizing, the recovery will be more moderate than is typical following a severe downturn, the National Association for Business Economics said in a report released this morning.

The panel of 45 economists said it expects economic growth will rebound in the second half of 2009. However, the group still expects to see a decline in second-quarter economic activity.

Home sales inch up

The residential real estate market picked up slightly in April, as increasingly affordable home prices attracted wary buyers.

The National Association of Realtors reported that sales of previously-owned homes ticked up nearly 3% last month to a seasonally adjusted annual rate of 4.68 million units, compared to the revised rate of 4.55 million in March.

Sales came in slightly ahead of expert forecasts of 4.66 million annual units but are still off 3.5% from the 4.85 sold 12 months ago.

First-time homebuyers continued to drive sales but there was also a seasonal rise of repeat buyers. Additionally, the median price of homes sold in April was just $170,200, a more than15% year-over-year drop.

Crude tops $63 per barrel

Crude oil prices climbed above $63 per barrel today after a Saudi oil minister said the global economy has strengthened enough to cope with oil at $75-$80 a barrel and that level will be hit soon as fuel demand picks up.

Oil has already climbed from a low of $32.40 last December to six-month highs well above $60 a barrel this week.

Still, crude remains well below the all-time high of $147 per barrel that it hit last July.

Gas approaching $2.50 per gallon

Gas prices rose 9-tenths of a cent to $2.434 overnight, the 29th straight increase.

In the last 29 days, the average price of gas has increased 38.6 cents, or 18.8 percent. But gas is still well below the record high price of $4.114 that AAA reported on July 17, 2008.

The highest gas prices are in Alaska ($2.727). The cheapest gas prices are in Missouri ($2.274).

As CNN prepares to mark President Obama’s first 100 days in office, we'll also have a detailed look at his wide-ranging initiatives intended to stem the economic downturn and financial crisis.

Andrew Torgan
CNN Financial News Producer

Government regulators have reportedly told Bank of America and Citigroup that both banks need to increase their capital reserves based on preliminary "stress test" results.

The capital shortfall at Bank of America could amount to billions of dollars, the Wall Street Journal said, citing people familiar with the situation.

Executives at both banks are said to be objecting to the preliminary findings, which emerged from the government's scrutiny of 19 large financial institutions. The two banks are reportedly planning to respond with detailed rebuttals, with Bank of America's appeal expected some time today.

The government conducted the so-called “stress tests” on 19 of the nation's biggest banks to determine which banks are healthy enough to survive another financial shock and which will need additional government support.

The findings suggest that government officials are using the tests to send a tough message to troubled banks. Results of the “stress tests” will be made public on May 4.

Surprise jump in consumer confidence

Consumer confidence soared in April amid signs that the economy may be starting to stabilize.

The Conference Board says its Consumer Confidence Index rose more than 12 points to 39.2, up from a revised 26.9 in March. The reading marks the highest point since November and trounces estimates.

And the Expectations Index, which measures how shoppers feel about the economy over the next six months, skyrocketed to 49.5 from 30.2 in March.

Home prices down

The weak housing market continued to plague home sellers in February as home prices extended their losing streak to 31 consecutive months.

However, the rate of decline slowed, with the S&P/Case-Shiller Home Price Index failing to hit a record low for the first time in 16 months.

The index fell 18.6% from February 2008, slightly better than the 19 percent in January. The 10-city index slid 18.8 percent, compared to 19.4 percent the month before.

But the good news was mixed. All 20 cities in the report showed monthly and annual price declines, and half recorded annual records.

No city I the index has fared as poorly as Phoenix, where prices have fallen 35.2% over the past 12 months and 4.5% in January. Prices are also down 51% from their peak.

Home ownership rate declines

The national home ownership rate fell in the first quarter to its lowest level in nine years, with the biggest drops among younger buyers who rode the wave of easily-accessible credit that fueled the housing boom.

The seasonally-adjusted home ownership rate was 67.5% in the first quarter of this year, down half a percentage point since the first quarter of 2008, according to the Census Bureau. That’s the lowest rate since the second quarter of 2000.

Chrysler reaches deal on debt

The major banks that loaned Chrysler about $7 billion have agreed to significantly reduce that debt, according to the Treasury Department, a move that could save the struggling automaker from having to file for bankruptcy later this week.

"The agreement from Chrysler's principal banks is an exceptional accomplishment in line with the President's firm commitment that all stakeholders sacrifice to make this deal succeed," an administration official told CNN Tuesday.

The company still needs to win a rank-and-file ratification vote Wednesday of a tentative labor deal reached with leadership of the United Auto Workers union late Sunday, and wrap up an alliance with Italian automaker Fiat before the Thursday deadline set by the federal government.

But the deal with lenders was generally thought to be the most difficult hurdle the company had to clear in the final week before the deadline.

Details of the debt reduction deal were not immediately available. The Washington Post reported that creditors agreed to cut the $6.9 billion in secured loans owed to them to $2 billion in return for an equity stake in a reorganized Chrysler.

Stocks struggle

Stocks on Wall Street dropped at the open as investors worried about the results of the government's “stress tests” of banks and the number of swine flu cases continued to rise.

But that better-than-expected reading of consumer confidence helped push the Dow Industrials back into the plus column.

Stocks rallied for six straight weeks on bets that the worst for the economy has already happened, then seesawed last week as corporate earnings season kicked into high gear.

First 100 Days: The economy

Finally, as CNN prepares to mark President Obama’s first 100 days in office, CNNMoney.com has a detailed look at his wide-ranging initiatives intended to stem the economic downturn and financial crisis.

Andrew Torgan
CNN Financial News Producer

With the World Health Organization calling the outbreak of swine flu a "public health emergency of international concern," stock markets around the world stumbled overnight and into Monday morning.

At a time when the global economy and financial system are already fragile, such a health scare will likely put the brakes on global travel and trade. The European Union, for example, is urging its citizens to avoid non-essential travel to Mexico and the United States in the face of the outbreak.

Meanwhile, airline and hotel stocks are tanking across the board on fears that a potential pandemic will cripple the global tourism industry.

And as you might expect, shares of the leading flu vaccine makers are getting a lift on the expectation that orders will increase.

Oil prices tumble

Crude oil fell more than 5% overnight as concerns about the potential economic repercussions of a swine flu pandemic weighed on the market and lifted the U.S. dollar.

Crude fell below $49/barrel in electronic trading this morning. On Friday, oil surged nearly 4% to settle at $51.55 a barrel.

GM goes for broke

General Motors today announced plans to cut 23,000 U.S. jobs by 2011, drop its storied Pontiac brand and slash 40% of its dealer network in its latest bid to stay out of bankruptcy.

The new restructuring proposal will leave the Treasury Department, and as such U.S. taxpayers, owning a significant stake in GM. The Treasury will accept GM stock rather than cash for repayment of about $10 billion that the government has already lent to the automaker.

Trust funds controlled by the United Auto Workers union would also hold a significant stake in the company. Between them, Treasury and the unions would own 89% of GM.

GM also announced an offer to its bondholders to swap $24 billion of the company's $27 billion in unsecured debt for stock. GM is offering bondholders 225 shares of its stock for every $1,000 it owes the bondholders in principal.

CEO Fritz Henderson warned during a press conference today that bankruptcy is still very likely unless bondholders agree to the swap.

The moves are GM's latest efforts to cut costs and stem losses that have dogged its North American auto operations since 2005, and today’s news represents an additional reduction of 7,000 to 8,000 jobs beyond what GM disclosed in its previous viability plan back in February.

Chrysler wins concessions from UAW

Meanwhile, privately-held Chrysler cleared another major obstacle to its survival Sunday when it reached a tentative deal for concessions with the United Auto Workers union

The automaker is just days away from a government deadline to gain concessions from its unions and debtholders, as well as form an alliance with Italy's Fiat, or face almost certain liquidation.

The UAW said the agreement was reached with Chrysler, Fiat and the Treasury Department - and includes modifications to the union's 2007 collective bargaining agreement and the trust program dedicated to retiree health benefits.

The deal does not, however, guarantee that Chrysler will be able to avoid bankruptcy. It still needs to be ratified by the automaker’s rank-and-file union members. That vote is scheduled to take place Wednesday.

Stay tuned…

General Motors says that about 1,600 salaried workers will lose their jobs in the next few days.

Andrew Torgan
CNN Financial News Producer

A key survey of leading businesses showed Monday that the nation's economy remained weak in the first quarter, but it also hinted that the decline is slowing.

The National Association of Business Economics' April Industry Survey "provides fresh evidence that the U.S. economy's recession is abating," said Sara Johnson, an analyst on the survey.

"Declines still out number gains, but fewer firms are reporting declines and more are reporting gains," Johnson said. "This suggests that the economy is at an inflection point but has not yet reached a turning point."

The big bank hot streak continues. Bank of America surprised Wall Street this morning by reporting a first quarter profit of $4.2 billion. That was well ahead of expectations.

But the stock fell sharply out of the gate as the bank warned of "deteriorating credit quality."

Over the past two weeks, rivals Wells Fargo, JPMorgan Chase and even Citigroup - which like Bank of America has received $45 billion in government assistance - have all delivered earnings that exceeded Wall Street's expectations.

Stocks opened lower this morning as investors turn their attention to a slew of mergers and those numbers from Bank of America.

Among the day’s deals, Oracle says it has entered into a definitive agreement to buy server builder Sun Microsystems in a deal worth $7.4 billion.

The announcement comes after Sun reportedly rejected a $7 billion buyout offer from IBM earlier this month.

And PepsiCo is offering about $6 billion to buy the shares it does not already own in its two largest bottlers to cut costs and secure control of its brands as growth switches to new non-carbonated drinks.

The company's plan to consolidate its bottling business underlines an industry trend and would give it control of 80% of its North America beverage distribution volume.

General Motors says that about 1,600 salaried workers at will lose their jobs in the next few days as the troubled automaker accelerates cost cuts in order to qualify for more government aid.

GM said in February it planned to cut 3,400 of its 29,500 U.S. salaried employees, with the majority of cuts completed by May 1.

President Obama plans to crack down on deceptive credit-card industry practices that have saddled consumers with huge debts and soaring interest rates, administration officials said Sunday.

White House economic adviser Lawrence Summers said the president would be “very focused in the very near term on a whole set of issues having to do with credit card abuses.”

“We need to do things to stop the marketing of credit in ways that addict people to it,” Summers said in an interview on the NBC’s “Meet the Press.”

And ExxonMobil shoved aside Wal-Mart Stores to retake the top spot on the Fortune 500, proving that Big Oil was king of the economy last year.

ExxonMobil was the top selling-company in 2008, with nearly $443 billion in revenue, a jump of almost 19% from the prior year. The oil giant was also the most profitable, with earnings of $45.2 billion.

Wal-Mart, which reigned as No. 1 on the Fortune 500 the past two years, slipped to second place.

Andrew Torgan
CNN Financial News Producer

The April 15 deadline to file your taxes is just days away, but today is “Tax Freedom Day.”

Americans had to work 103 days from January 1 before they earned enough to pay their taxes for 2009, according to the Tax Foundation. Everything after that is theoretically theirs to keep.

April 13 is the earliest date since 1967. That's eight days earlier than 2008’s “Tax Freedom Day” and a full two weeks earlier than 2007’s.

The Tax Foundation cited two reasons for the shift to an earlier date: The recession has reduced tax collections faster than it has reduced income; plus, the Obama administration's stimulus package includes large temporary tax cuts for 2009 and 2010.

So with millions of Americans facing job losses and the threat of foreclosure, what do you do if you can't pay your taxes? IRS Commissioner Douglas Shulman will make an appearance at the National Press Club in Washington today to discuss his agency's new initiatives to help those in financial distress, including giving IRS employees the flexibility to adjust or defer tax payments for certain taxpayers in hardship situations.

Shulman is also expected to highlight the new tax credits available this year, such as those for first time home buyers and car buyers, and give offer advice on what to do if you're having trouble paying your taxes.

CNNMoney.com has launched a special section: “Get Ready for April 15”

In it, you will find tax tips for the unemployed, advice for 10 million late filers and 8 tips to slash your tax bill.

Stocks on Wall Street opened lower opening as investors prepare for earnings season to begin in earnest and await new economic data that will provide more details on the struggling economy.

Earnings this week will be led by Dow components Citigroup and JPMorganChase. Stocks are riding a streak of five straight weekly gains, the best weekly run since October of 2007.

The earnings parade gets underway Tuesday morning when Goldman Sachs is due to report its financial results.

But the firm's first-quarter profits aren't the main source of suspense. Instead, investors are betting that Goldman will put itself on track to become the first big bank to repay its $10 billion government loan.

Investors are also bracing for a possible bankruptcy filing by General Motors.

The New York Times is reporting that The Treasury Department is directing GM to lay the groundwork for a so-called “surgical bankruptcy” filing by a June 1 deadline, despite GM’s contention that it could still reorganize outside court.

A “surgical bankruptcy” would be quick and precise, as opposed to a long, messy process that could damage the automaker’s image and sales.

One plan under consideration would create a new company that would buy the “good” assets of GM almost immediately after the carmaker files for bankruptcy, the New York Times said.

Less-desirable assets, including unwanted brands, factories and health care obligations, would be left in the “bad” GM, which could be liquidated over several years.

The “good” GM could enter and exit bankruptcy in as little as two weeks, using $5 billion to $7 billion in federal financing, the Times said.

The “bad” GM could require as much as $70 billion in government financing, and possibly more to resolve the health care obligations and the liquidation of the factories.

Crude oil prices fell below $50 a barrel today, after the International Energy Agency cut its forecast for oil demand.

On Friday when the market was closed, the IEA said world oil demand will fall by 2.4 million barrels a day this year. A separate inventory report last Wednesday showed U.S. oil supplies at their highest levels since 1993.

Gas prices fell by 1-tenth of a cent overnight to $2.051 a gallon.

28 states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.512).

22 states have regular unleaded gas prices below $2. The cheapest gas prices are in New Jersey ($1.876).

And finally, two opening-day New York Mets tickets, part of a season ticket package formerly owned by convicted Ponzi schemer Bernard Madoff's company, fetched $7,500 in an eBay auction Sunday morning.

The price of the tickets spiked dramatically in the auction's final minutes, nearly doubling from a cost of $3,800 two hours prior to the auction's close. A bidding war between two parties accounted for most of the final bidding action, according to the auction history.

The Mets' opening day is scheduled for Monday night in the new “Citi Field” in Queens, NY, which some are calling “Bailout Ballpark.” Banking giant Citigroup agreed to pay $400 million for the naming rights to the ballpark back in 2006, and later took $45 billion in taxpayer bailout money.

Andrew Torgan
CNN Financial News Producer

Stocks on Wall Street roared out of the starting gate as investors applauded an unexpectedly bullish forecast from Wells Fargo.

The bank says it expects to book a profit of approximately $3 billion in the most recent quarter, exceeding analyst’s expectations and adding to hopes that the hard-hit financial sector is stabilizing.

Wells Fargo shares soared 25%, giving the entire banking sector a boost.

Some mixed news on the unemployment front today... the number of Americans filing initial claims for jobless benefits dropped last week while the number of people continuing to claim benefits set a record for the 11th straight week.

First-time claims for unemployment insurance fell by 20,000 to 654,000 from the previous week revised figure of 674,000.

But the number of people receiving benefits for one week or more rose by 95,000 to a new record high of 5.84 million.

The U.S. trade deficit plunged unexpectedly in February to the lowest level in more than nine years as the steep recession pushed imports down for a seventh straight month.

The Commerce Department says the deficit dropped a sharp 28.3% to $25.97 billion, the smallest gap since November 1999.

That marks the seventh consecutive month the trade deficit has declined as the severe recession has cut sharply into demand for imported products.

Wal-Mart Stores reported March sales today that were much softer than analysts' forecasts, citing an "Easter calendar shift" that it expects to push holiday-related purchases into April.

Wal-Mart, the world's largest retailer, said sales at its stores open at least a year, a key measure of performance known as same-store sales, rose 1.4% last month.

Although comparable store traffic increased in the month, the retailer said the average checkout total was lower, "mostly due to the Easter shift and, to a lesser degree, inflation at a lower rate than last year in grocery."

Health and wellness items, home products, and grocery items were Wal-Mart's strongest performing categories in March.

Moody's Investors Service has cut its top credit ratings on investor Warren Buffett's Berkshire Hathaway, saying the recession and investment losses at the insurance operations of his holding company reduced its ability to support funding needs.

Wednesday's cut to Berkshire's rating means Moody's no longer has its highest rating on any company with significant financial-services operations.

Buffett admitted last month he made some "dumb" mistakes in 2008, when Berkshire's profits fell 62% – the worst performance in its 44 years.

Gas prices increased by 4-tenths of a cent overnight to $2.051 a gallon.

30 states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.544).

20 states have regular unleaded gas prices below $2. The cheapest gas prices are in New Jersey ($1.872).

Finally, U.S. financial markets will be closed tomorrow for Good Friday. Trading resumes on Monday, April 13.

Andrew Torgan
CNN Financial News Producer

A big merger in the home-building sector is giving Wall Street a lift today, overshadowing dismal numbers from aluminum maker Alcoa as earnings season gets underway.

Pulte Homes is acquiring Centex Corp. in a stock transaction worth $3.1 billion. And that’s ignited a rally across the entire building sector. Executives say the deal will put the combined company in a better position to navigate the weak housing environment.

New home sales sank to the lowest level on record in January, but rebounded slightly in February.

Insurance stocks are also making gains today, following reports that the Treasury Department is poised to open its $700 billion bailout program to life-insurance companies, helping an industry that is considered a lynchpin of America’s financial system.

Investors have been increasingly worried about the health of life insurers, which have been hit hard by worries about capital requirements and mounting losses.

The life-insurance industry is an important component of the financial system. Millions of people have placed their families' financial well-being in the hands of such companies, so keeping them afloat is considered crucial to maintaining confidence.

And speaking of bailouts, the Treasury Department says struggling automakers Chrysler and GM have launched supplier support programs backed by up to $5 billion in government funds.

The programs will guarantee receivables owed to the auto parts suppliers for any goods shipped after March 19.

GM will get $2 billion under the Treasury programs and Chrysler will receive a $1.5 billion line of credit.

Consumer credit fell in February, led by a sharp decline in credit card usage, as the ailing economy and widespread unemployment curbed spending.

Total consumer borrowing fell a seasonally-adjusted $7.4 billion, or 3.5%, to $2.564 trillion in February, according to the Federal Reserve.

Securities regulators voted unanimously today to issue proposed curbs on short selling - a type of investing blamed by some lawmakers and executives for exacerbating the financial crisis and driving down stock prices - for a 60-day public comment period..

That includes the return of the so-called "uptick rule," which allowed short sales - a bet that a stock's price will fall - only when the last sale price was higher than the previous price.

The rule, first adopted after the 1929 stock market crash, is viewed by some as a way to relieve downward pressure on a stock that is dropping sharply.

The SEC previously concluded that advances in the marketplace had rendered the rule ineffective and abolished it in 2007.

Gas prices jumped by 7-tenths of a cent overnight to $2.047 a gallon.

29 states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.522).

21 states have regular unleaded gas prices below $2. The cheapest gas prices are in New Jersey ($1.873).

And finally, Ford is recruiting 100 young, Web-savvy volunteers to test drive its new Ford Fiesta over the next six months.

Volunteers get the keys handed to them for free, but in return they have to post their impressions on the small, fuel-efficient vehicle on social networking sites.

And the buzz is already building: Ford received some 4,000 applications for the program, and has launched a fan page on Facebook.com a Twitter account, and a YouTube channel.

Andrew Torgan
CNN Financial News Producer

With unemployment at a 25-year high, housing prices continuing to fall and corporate titans like General Motors on the brink of bankruptcy, there's no lack of horrendous economic news out there.

But despite all the gloom and doom, there are a growing number of economists who see a recovery on the horizon - and perhaps even a strong rebound.

They’re saying that a number of indicators appear to have bottomed out in recent months. Job losses may have peaked in January. Home sales are starting to pick up. Stocks have been enjoying a strong rally the last four weeks… although not today.

And because the economy has experienced such a steep decline in the current downturn, some economists are hopeful the recovery ahead will be much stronger than the anemic gains that came about after the end of the previous two recessions.

In a related development, Americans have grown more optimistic about the economy and the direction of the country since President Barack Obama took office in January, according to the latest New York Times/CBS News poll.

Two-thirds of respondents said they approved of Obama's overall job performance. Just 31% said they had a favorable view of the Republican Party, the lowest in the 25 years the question has been asked in the poll, The New York Times said.

The number of people who said they thought the United States was headed in the right direction jumped from 15% during the final days of President George W. Bush's Administration in mid-January, before the inauguration, to 39% today, the newspaper said.

The number of respondents who said the country was headed in the wrong direction dropped to 53% from 79%.

Stocks on Wall Street opened lower as investors brace for the start of what is expected to be another grim corporate earnings season.

Things kick off after the closing bell when Dow component Alcoa posts what is expected to be a huge loss. Shares of the aluminum giant are down more than 80% over the past year.

Goodbye Hummer, hello scooter?

General Motors and the maker of the Segway personal transporter have joined forces to develop a two-seat, two-wheeled, electric-powered vehicle for use navigating city streets.

The prototype of the new vehicle - called Project P.U.M.A., which stands for Personal Urban Mobility and Accessibility - was unveiled today in New York City.

The two-person scooter-mobile travels up to 35 miles per hour and runs as much as 35 miles between recharges, the companies said. The vehicle runs on large-format lithium-ion batteries that the companies say produce no emissions, making it environmentally friendly.

At GM, meanwhile, preparations for a possible bankruptcy filing have become “intense and earnest,” according to a source familiar with the company's plans.

The source, who spoke on the condition of anonymity, said GM still hopes to win concessions from its creditors and unions that will allow it to avoid bankruptcy. But the June 1 deadline given to the company by President Obama and the Treasury Department to reach deals or go into bankruptcy has caused a pick-up in preparations.

The auto task force overseeing $13.4 billion in federal loans GM has already received declared last month that neither the company - nor rival Chrysler - were viable under turnaround plans the companies submitted on Feb. 17.

Chrysler was given only 30 days to reach a new alliance with Italian automaker Fiat. GM was given 60 days to get creditors to agree to swap debt for equity, and to win further concessions from the United Auto Workers union. The government also forced GM Chairman and CEO Rick Wagoner to resign last week.

Low unemployment and foreclosure rates apparently have put smiles on faces in Nebraska.

MainStreet.com says that what the Cornhuskers may lack in big-city salaries, they make up for in financial security, giving the state the top slot in its new Happiness Index.

Rounding out the top five states are Iowa, Kansas, Hawaii and Louisiana.

At the bottom of the pile: Oregon.

Gas prices rose by 1-tenth of a cent overnight to $2.040 a gallon.

24 states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.520).

26 states have regular unleaded gas prices below $2. The cheapest gas prices are in New Jersey ($1.872).

One final high note to cap off the day: tax refunds are up so for this year.

As of March 20, the IRS says it has already sent tax refunds to nearly 67 million taxpayers totaling more than $183 billion - and the average tax refund was $2,740, up 10% from the prior year.

Why? Part of the reason is new tax breaks due to the Stimulus Plan. Some homeowners can deduct amount paid in real estate taxes, up to $1,000 for joint filers who do not itemize. And first-time homebuyers can get a $7,500 credit if they bought between April 9 and December 31, 2008.

But remember, you must file your tax return by April 15. That’s next Wednesday. You can find more information at the IRS Website.

Andrew Torgan
CNN Financial News Producer

In the wake of the Obama Administration’s program to rescue troubled homeowners, a number of federal agencies are teaming up to fight mortgage and foreclosure scams.

The administration's $75 billion effort to help as many as 9 million mortgage holders get new or refinanced loans is drawing a lot of interest from homeowners, Treasury Department officials said.

"Those who would seek to prey on the most vulnerable also seek to intensify their efforts as well," Treasury Secretary Tim Geithner said today. "We will aggressively pursue those involved in mortgage rescue scams."

The Treasury, the Department of Justice, the Federal Trade Commission and the Department of Housing and Urban Development will lead the efforts from Washington. State attorneys general will also participate.

More people in the U.S. have fallen behind on loan payments than ever before.

According to a new study from the American Bankers Association, the percentage of consumer loans at least 30 days late rose to a seasonally adjusted rate of 3.22% in fourth quarter of 2008 - a record high.

Delinquencies rose in nearly every category, including home equity, auto and personal loans. The study also said these credit trends are unlikely to improve before 2010.

According to the ABA, the late payment rate on auto loans made through dealers rose to a record 3.53 percent in the fourth quarter from the third quarter’s 3.25 percent, while late payments on home equity lines of credit rose to a record 1.46 percent from 1.15 percent.

The delinquency rate on credit cards rose to 4.52 percent from 4.20 percent, but remained only slightly above the average over the last four years.

Consequently, one banking analyst is saying that the amount in loans that banks will need to write off will exceed levels seen during the Great Depression.

In a report on the banking sector, Mike Mayo of Calyon Securities says, “The seven deadly sins of banking include greedy loan growth, gluttony of real estate, lust for high yields, sloth-like risk management, pride of low capital, envy of exotic fees, and anger of regulators.”

He says the nation’s banks face a three-fold problem: higher structural risk, cyclical pressures, and “catch-22 government actions.”

Stocks opened to the downside today, despite the wave of economic optimism that boosted markets around the world.

Wall Street is coming off its best four-week run since the 1930s, but could hit some resistance in this holiday-shortened week. Financial markets are closed April 10 for Good Friday.

With the number of jobless in the United States topping 13 million, Sallie Mae - the largest student lender in the country - says it plans to move 2,000 jobs to the U.S. from Mexico and Philippines within the next 18 months as it shifts call center and other operations from overseas.

Six-hundred of the jobs will be relocated to Wilkes-Barre, PA. The locations for the remaining jobs have not yet been determined.

Sallie Mae runs facilities in 20 locations in states ranging from Delaware, Florida, Indiana, Pennsylvania, Texas and Virginia.

Gas prices declined by 1-tenth of a cent overnight to $2.039 a gallon.

Twenty-four states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.498).

Twenty-six  states have regular unleaded gas prices below $2. The cheapest gas prices are in New Jersey ($1.869).

And finally… as the economy melted down last year, so did CEO paychecks.

The average compensation for 200 chief executives at America's largest public companies fell 5.1% last year to $10.8 million, according to a survey published Sunday by the New York Times and research firm Equilar.

The decline marked the first time in five years that top executives' pay packages shrank compared to the year before.

President Obama is discussing the global economic crisis with other world leaders at the G-20 summit this week.

Andrew Torgan
CNN Financial News Producer

More dreary news on the unemployment front today ahead of Friday’s big jobs report for March.

The number of Americans filing initial claims for jobless benefits rose unexpectedly last week while the number of people continuing to claim benefits set a record for the 10th straight week.

First-time claims for unemployment insurance rose by 12,000 to 669,000 from the previous week revised figure of 657,000.

The number of people receiving benefits for one week or more, meanwhile, rose by 161,000 to 5.73 million. That’s the highest number on records dating back to 1967.

The increasing number of people continuing to file for unemployment benefits suggests that Americans are struggling to re-enter the workforce.

Stocks on Wall Street roared out of the gate this morning, sending the Dow Industrials above the 8,000 level for the first time in seven weeks.

Today’s rally is being sparked by several factors, including the news out of the G20 Summit in London and a change in the accounting rules that affect how banks value some of the so-called “toxic” assets on their balance sheets.

More now on those “toxic” assets… the board that sets U.S. accounting standards is expected to give companies more leeway when valuing assets, providing a potential boost to banks’ balance sheets.

The Financial Accounting Standards Board - a private-sector body that sets the nation’s bookkeeping rules - is set to vote to adopt new guidelines under the so-called “mark-to-market” accounting rules, which require companies to value assets at prices reflecting current market conditions.

The changes would allow companies to use significant judgment in valuing assets to reduce write-downs on certain investments, including mortgage-backed securities.

The rule changes come just as the nation’s big banks are preparing to issue their first-quarter results, and analysts are expecting another rough ride for the likes of Bank of America, Citigroup, JPMorgan Chase and Wells Fargo.

The new FASB rules could help boost banks' earnings significantly by making it clear that institutions can account for mortgage-backed securities and other assets based on their internal estimates, rather than relying on sales prices.

Former AIG Chief Executive Maurice “Hank” Greenberg, blaming his successors for the mistakes that led to the company's failure, told Congress today that the government's plan to unwind the insurance giant is not working and threatens its ability to pay back the billions it has received in taxpayer funds.

In testimony before a House oversight committee hearing, Greenberg said AIG's problems stem from decisions that came after his 2005 departure. He said the company’s overseers must reverse their current strategy of selling off AIG's assets and maintaining an 80% ownership stake in the company.

Greenberg, 83, ran AIG for nearly four decades until he was ousted in 2005 over an accounting fraud scandal. He was never charged in a federal case that led to five convictions.

Treasury Secretary Tim Geithner says he would consider forcing out CEOs of banks that receive government bailouts if they were not managing their businesses properly.

In an interview with CBS on Wednesday, Geithner said economic recovery depends on a financial system that effectively provides credit, and the government would hold companies receiving public aid accountable.

When asked whether he left open the option to pressure a bank CEO to resign, Geithner responded, “Of course.”

Gas prices declined by 2-tenths of a cent overnight to $2.045 a gallon.

28 states and the District of Columbia have regular unleaded gas prices of $2 and higher. The highest gas prices are in Alaska ($2.520).

22 states have regular unleaded gas prices below $2. The cheapest gas prices are in Wyoming ($1.859).

The national housing slump is finally crashing on the shores of Manhattan, which had its worst quarter in years, according to several industry reports released on today.

The big hit was seen in sales volume, which plummeted 48% in the first quarter of 2009 compared to the previous quarter and year.

Meanwhile, the median sales price of all condo and co-op apartments sold rose 6%, to $907,500, in the first quarter of 2009 compared to the first quarter of 2008.

CNNMoney.com has an interactive map that let’s you see where home prices are headed all over the country.

Finally, even in death, people are cutting costs.

Industry insiders say more people are economizing on funerals by cutting back on elements such as limousines, wakes and embalming - and opting for cremations rather than burials.

Andrew Torgan
CNN Financial News Producer

We’ve got some mixed news today on the employment front ahead of Friday’s big jobs report for March.

The private sector lost more than 700,000 jobs in March, according to payroll-processing firm ADP, but a separate report suggests that the pace of job cuts may be slowing.

The ADP report said the private sector eliminated 742,000 jobs on a seasonally adjusted basis in March. That up 36,000 from last month's revised figure of 706,000.

Separately, outplacement firm Challenger, Gray & Christmas reported that the number of planned job cuts announced in March fell for the second straight month.

The number of existing homes put under contract ticked up in February after hitting historic lows the previous month.

The National Association of Realtors reported that its monthly Pending Home Sales Index rose 2.1% in January.

The Midwest saw the largest gain of any regions, with pending home sales jumping 14.5%. The Northeast also recorded double-digit growth at 10.6%. The South inched up 4.4%, and the West dropped 13.5%.

A closely-watched index of the manufacturing sector shows activity rose slightly in March, inching up for a third month, but the reading still indicates an ongoing contraction.

The Institute for Supply Management's Manufacturing Index rose to 36.3 in March, up from 35.8 the previous month.

The slight month-to-month improvement indicates that the rate of contraction has slowed, but not reversed itself. Manufacturing is widely considered to be a key indicator in assessing the strength of the overall economy.

Index readings above 50 are considered to indicate growth, while levels below 50 signal contraction. Readings below 41 are associated with a recession in the broader economy.

The government reportedly may seek to ease General Motors into what it calls a “controlled” bankruptcy, somewhere between a prepackaged bankruptcy and court chaos, by persuading at least some creditors to agree to a plan that would cleave the company into two pieces.

Instead of signing on every creditor as is typically required in prepackaged deals, Obama Administration officials are using as leverage the promise of taxpayer financing. Many regard the government as the only lender willing to step up with money - in bankruptcy or out.

CNNMoney.com takes a look at what a bankruptcy at GM or Chrysler would mean for everyone from consumers, to autoworkers, suppliers and dealerships, as well as investors and taxpayers.

Also on the automotive front, the world’s major automakers today report their U.S. car and truck sales figures for March, and it goes without saying that the numbers from Detroit’s Big Three are expected to be horrendous.

Ford was first out of the gate, posting a 41% in sales last month from a year earlier.

Honda Motor, Japan's No. 2 automaker, says it will cut production in North America by temporarily shutting factories from next month and will reduce pay for workers as sales in the United States plunge to multi-decade lows.

Gas prices declined by 1-tenth of a cent overnight to $2.047 a gallon.

Twenty-nine states and the District of Columbia have regular unleaded gas prices of $2 and higher. 21 states have regular unleaded gas prices below $2.

The highest gas prices are in Alaska ($2.508). The cheapest gas prices are in Wyoming ($1.853).

3M says it's cutting its worldwide workforce by another 1,200 jobs, or 1.5 percent, because of the global economic slump.

A 3M spokesperson says that fewer than half the jobs will be in the United States but include "several hundred" in Minnesota, mostly at the company's headquarters.

3M, the maker of Scotch tape, Post-It Notes and other products, has operations in more than 60 countries that employ 79,000 people.

And when it takes nearly half a year to find a new job, a severance package from your previous employer can be a lifesaver. But what if that safety net was gone?

A new survey shows many companies say they will take a closer look at their severance packages in response to ongoing economic conditions.

According to the survey, 20% of companies plan to make changes to their severance plans and 31% said they were unsure. Of those making changes, 43% plan to reduce cash payments, and 21% plan to reduce benefits like health insurance, retirement benefits, disability, financial assistance or life insurance to laid-off workers.

Andrew Torgan
CNN Financial News Producer

Ford and General Motors today introduced new incentive programs designed to lure car buyers worried about losing their jobs.

Ford, as part of its "Drive One" deal, says it will make as many as 12 monthly payments of $700 or less on behalf of new car purchasers who lose their jobs. The program begins today and will continue through June 1.

The offer applies to buyers of any new Ford, Lincoln or Mercury vehicle.

GM is calling its plan "GM Total Confidence." The automaker will make as many as nine monthly payments of up to $500 each for buyers who lose their jobs "for economic reasons" during the first two years of ownership. Only those eligible for state unemployment benefits will be able to have their car payments covered.

The incentive programs are similar to one introduced in January by South Korea’s Hyundai.

The White House has appointed a “car czar” to look out for the people and communities that depend on the automotive industry, an acknowledgment that the sweeping government-led overhaul will likely mean more job losses.

Ed Montgomery, a dean at the University of Maryland who served as deputy labor secretary in the Clinton administration, was appointed director of recovery for auto communities and workers. An economist specializing in job training and local development, Montgomery will help direct federal funds to those hardest hit by the industry's meltdown.

The auto industry has shed more than 400,000 jobs over the past year, which has devastated company towns throughout Michigan, Ohio and Indiana.

President Obama flew to London this morning en route to the G20 Summit - a meeting that billionaire investor George Soros calls a “make or break event” for global markets.

The alliance of economic superpowers accounts for about 85% of the world's output, so the decisions made in this week's meetings could impact nearly every person on earth.

You can follow all the latest developments at the summit this week on CNNMoney.com.

Stocks on Wall Street opened higher today as investors waded back into the market on the last trading day of a choppy quarter.

Stocks tumbled Monday, falling for a second consecutive session, as auto industry worries sparked a selloff after the recent rally. Stocks had gained over 20% in less than three weeks on optimism that the economy is closer to stabilizing.

Home prices in 20 major cities fell at record levels in January, with prices down 2.8% from December and 19% from a year earlier. That’s both a monthly and an annual record.

The S&P Case-Shiller Home Price Index, a comparison of price changes recorded when homes are resold, is considered to be one of the most accurate gauges of market trends available. Its 20-city index has been down for 30 straight months.

All told, prices have plunged 29.1% nationally since they peaked during the second quarter of 2006.

A key index of consumer confidence rebounded slightly in March, but it held near historic lows as consumers remained uneasy about the economy and the labor market.

The Conference Board, a New York-based business research group, said its Consumer Confidence Index rose to 26 in March from a revised reading of 25.3 in February.

Last month's reading was the lowest since the index was created in 1967, while this month's increase marked the first rise since November.

Gas prices held steady overnight at $2.048 a gallon, putting the brakes on 13 consecutive days of gains.

29 states and the District of Columbia have regular unleaded gas prices of $2 and higher. 21 states have regular unleaded gas prices below $2.

The highest gas prices are in Alaska ($2.500). The cheapest gas prices are in Wyoming ($1.842).

The number of travelers boarding U.S. airliners will plunge nearly 8% in 2009, a drop matched only in the year following the 2001 terrorist attacks, according to a government forecast out today.

The short-term forecast is downbeat for virtually every segment of the aviation business, the FAA predicted. Major airlines are expected to bear the brunt of the decline, with a projected 8.8% drop that would return them to passenger levels last seen in 1995.

Travelers might initially benefit from low prices, industry insiders say. But those hoping to find plenty of vacant seats, easy flight availability and long-term bargains will be disappointed. Airlines fighting to survive are cutting low-revenue flights, filling planes to capacity and eventually will increase rates.

And finally, the company that owns the Chicago Sun-Times and 58 other newspapers and online sites has filed for bankruptcy, earning Chicago the distinction of being the first city in the nation served by two insolvent newspapers.

The Sun-Times Media Group said it would continue to operate its newspapers and Websites as usual while it improves its cost structure and stabilizes operations.

Tuesday's announcement comes amid a raft of newspaper closings and cuts that has seen the end of The Rocky Mountain News in Denver, The Seattle Post-Intelligencer and The Christian Science Monitor.

The chain that owns the Los Angeles Times and the Chicago Tribune is already in bankruptcy and numerous other papers are on the brink.

Andrew Torgan
CNN Financial News Producer

Treasury Secretary Tim Geithner called for new rules today that would allow regulators to police the darkest corners of the financial markets, including hedge funds and derivatives trading.

The country also needs a single regulator to oversee the biggest financial firms, Geithner told the House Financial Services Committee.

"Our system failed in basic fundamental ways," Geithner said in written testimony. "The system proved too unstable and fragile, subject to significant crises every few years, periodic booms in real estate markets and in credit, followed by busts and contraction."

The comments came as Geithner testified before the congressional panel on the need for a sweeping overhaul of financial regulation in the wake of the worst financial crisis since the Great Depression.

The nation's Gross Domestic Product, the broadest measure of economic activity, fell at an annual rate of 6.3% during the final three months of 2008, the government confirmed today in its final reading.

That's slightly worse than the government's previous estimate of a 6.2% drop in the period. Still, as we’ve reported with the two prior GDP readings, the drop is the biggest one-quarter decline in this key measure in 26 years.

The report showed broad based declines across various measures of economic activity.

Spending by consumers fell at a 4.3% rate, with purchases of big ticket items plunging 22%. Investment in housing fell 23% from already depressed levels, completing three straight years of declines in that sector.

The number of Americans filing initial claims for jobless benefits rose slightly last week while the number of people continuing to claim benefits set a record for the 9th straight week.

First-time claims for unemployment insurance rose by 8,000 to 652,000 from the previous week revised figure of 644,000.

The number of people receiving benefits for one week or more, however, increased by 122,000 to 5.56 million. That’s the highest number on records dating back to 1967.

Meanwhile, the unemployment rate in Michigan, suffering under the near-collapse of the auto industry, hit 12% in February, according to data released by the state on Wednesday.

Michigan had the highest unemployment rate of any state in January, the most recent month for which there is national data.

Mass layoffs, pay cuts and the credit crunch have limited Americans' ability to buy cars and other big items. In turn, the suffering auto and manufacturing industries have battered Michigan.

Stocks on Wall Street opened to the upside, lifted by hopes that the economy may be starting to stabilize somewhat.

A late-session rally helped stocks finish in positive territory Wednesday with investors cheering better-than-expected readings on new home sales and durable goods orders, and a jump in financial stocks.

Gas prices are back above the $2 mark nationwide for the first time in four months.

The national average price for a gallon of regular unleaded gas rose 2.3 cents overnight to $2.009 a gallon. That’s the 9th consecutive increase.

Twenty-three states and the District of Columbia have regular unleaded gas prices of $2 and higher. 27 states have regular unleaded gas prices below $2.

The highest gas prices are in Alaska ($2.496). The cheapest gas prices are in Wyoming ($1.798).

Despite the recent run-up, gas prices are still more than 50% below the record high price of $4.114 that AAA reported on July 17, 2008.

Finally, do you remember the program called HOPE for Homeowners? The $300 billion foreclosure-prevention plan passed last summer?

Well CNNmoney.com has done a little digging and has discovered that in the five months since the program has been in effect, HOPE has helped exactly one homeowner to avoid foreclosure.

Andrew Torgan
CNN Financial News Producer

Stocks regained their momentum this morning, fueled by unexpectedly strong reports on manufacturing and home sales, and one day after President Obama defended his administration's ability to combat the economic crisis in a primetime news conference.

During that news conference, Mr. Obama said there would be no “quick fixes” for the recession and that it would take time for the economy to recover. But he also insisted his administration has a strategy in place to "attack this crisis on all fronts."

A little more than an hour into the trading day, the Dow Industrials were up 200 points and the Nasdaq Composite and the S&P 500 were adding more than 2% each.

A little more on those reports now.

New orders for long-lasting manufactured goods unexpectedly rebounded in February, rising for the first time in seven months.

The Commerce Department said durable goods orders rose 3.4% to $165.6 billion in February, the biggest increase since December 2007. That comes on the heels of a more than 7% drop in the prior month and indicates that businesses are staring to spend again.

And sales of newly constructed homes unexpectedly rose in February, rebounding nearly 5% after sinking to the lowest level on record in January.

That was the first increase since July, and it comes after sales tumbled to all-time lows in recent months. On Monday, we learned that sales of previously-owned homes rose 5.1%.

Today’s report also showed that the median sales price of new houses sold in February was $200,900, down 18% from $245,300 a year ago.

Mortgage applications jumped last week as record low interest rates spurred a surge in demand for home refinancing loans.

The Mortgage Bankers Association said its seasonally-adjusted index of mortgage applications, which includes both purchase and refinance loans, increased 32.2% to 1,159.4 for the week ended March 20.

Refinancing accounted for 78.5% of all applications.

The Obama Administration today released more details of its plan to give the government more power to take over and wind down troubled financial companies deemed too big to fail.

Treasury Secretary Tim Geithner proposed that the Treasury be the one to make the final call of when a non-banking firm, such as AIG or Lehman Brothers, is in deep trouble and needs government intervention. The Treasury Dept. would do so after talking with the Federal Reserve and the president, according to Treasury plans.

For days, Geithner has been saying that he needs more power to step in to prevent the kind of collapse of the financial sector that threatens to deepen the recession.

Gas prices rose 2-cents overnight to $1.986 a gallon, the 8th consecutive increase.

Eight states and the District of Columbia have regular unleaded gas prices of $2 and higher. 32 states have regular unleaded gas prices below $2.

The highest gas prices are in Alaska ($2.510), while the cheapest are in Wyoming ($1.783).

Despite the recent run-up, gas prices are still more than 50% below the record high price of $4.114 that AAA reported on July 17, 2008.

Finally, despite turbulence in the financial markets and the global economic downturn, the world's 25 top-earning hedge fund managers raked in a staggering $11.6 billion last year, according to a ranking released this morning.

On average, the managers took home $464 million each, Alpha magazine's annual list of top hedge fund earners showed. By comparison, the average take home pay in 2007 was a whopping $892 million.

Leading the pack was James Simons of New York's Renaissance Technologies, who took home $2.5 billion in 2008.

Twenty years on, the iconic oil spill remains an expensive ecological disaster.

Nature News
Naomi Lubick

When people think of big oil spills, they think of the Exxon Valdez. Twenty years ago, the oil tanker spilled its load off the coast of Alaska, and images of oil-slicked birds hit the news at a time when environmental awareness was quickly rising in the United States.

The accident became a lightening rod for green groups and lawmakers, but has also prompted hundreds of scientific studies looking at the implications of the disaster on local people, the ecosystem, remediation practices and oil spill response. Nature takes a look back at the disaster, and finds out what the situation is today.

Read more...